Business

Premier Cho Applauds US Trade Team’s Tariff Reductions

Published

2 months ago

19 January, 2026

Premier Cho Jung-tai welcomed Taiwan’s trade negotiation team upon their return from the United States, praising their efforts in securing a significant tariff reduction and investment agreements. The team, led by Vice Premier Cheng Li-chiun and chief trade negotiator Yang Jen-ni, reached a preliminary agreement that includes lowering tariffs on Taiwanese goods from 20 percent to 15 percent.

This agreement aligns Taiwan’s tariff rate with those imposed on major trading partners such as Japan, South Korea, and the European Union. The announcement, made on Thursday, has sparked mixed reactions among stakeholders within Taiwan, highlighting both optimism and concerns regarding the long-term implications of the deal.

Investment Commitments and Economic Implications

The trade deal also features a commitment from Taiwanese semiconductor and technology companies to invest at least $250 billion in the US market. This figure includes a previously pledged $100 billion investment from Taiwan Semiconductor Manufacturing Co (TSMC), which was made shortly after US President Donald Trump took office. US Secretary of Commerce Howard Lutnick confirmed the details on Friday, noting that TSMC’s earlier investment of $65 billion for three advanced wafer fabrication plants in Arizona was not included in this new agreement.

In addition to the tariff reductions, Taiwan has agreed to provide up to $250 billion in credit guarantees aimed at supporting investments in the US from both the semiconductor industry and the information and communication technology sectors. The formal terms of the agreement are expected to be signed in the coming weeks and will require approval from Taiwan’s Legislative Yuan.

Mixed Reactions and Concerns

The agreement does not specify a timeline for when the investments must be realized, raising additional concerns among skeptics. TSMC’s chief financial officer Wendell Huang indicated that the company is fast-tracking its investments in Arizona due to increasing customer demand. Despite expanding operations in the US, Huang emphasized that TSMC’s most advanced technologies would continue to be developed and retained in Taiwan for “practical reasons,” citing the critical nature of collaboration between the company’s research and development teams and its operational units.

As Taiwan moves forward with this trade agreement, the balance between fostering international collaboration and safeguarding domestic industries remains a pivotal concern for many in the region.

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